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Friday, April 1, 2016

Saudis Signal End of oil dominating the world stage? Saudi Arabia planning for the end of the oil age by creating a $2 TRILLION investment fund which would be big enough to buy Google, Apple and Microsoft

Oil prices are being hit in part owing to
the return of Iranian crude to markets after crippling economic
sanctions on Tehran were lifted following last year’s nuclear deal
between Iran and world powers

Saudi Arabia annonces a $2 TRILLION mega investment fund Mohammed bin salman, Second-in-line to Saudi Arabian throne announced public investment fund PIF will be enough to buy Google, Apple and Microsoft with money to spare Kingdom hopes to be economy that doesn't depend on oil within 20 years
Continue after the cut ...

The Deputy Crown Prince said the kingdom must 'diversify its investments'Saudi Arabia insists it will only freeze output if other key producers do too

Saudi
Arabia is preparing for the end of the oil age by creating a $2trillion
investment fund which is set to be ‘the largest on Earth’.

The
Public Investment Fund (PIF) established by the kingdom’s
second-in-line to the throne will eventually be large enough to buy
Google, Apple and Microsoft with money to spare.

Deputy
Crown Prince Mohammed bin Salman, who oversees the fund, claims that
the initial public offering could happen as soon as next year.

It
comes as Saudi Arabia, the world’s biggest crude exporter, insists that
it will only freeze its oil output if other key producers, including
Iran, take a similar measure.

‘What is left now is to diversify investments,’ the 30-year-old prince told Bloomberg, during an interview from the royal compound in the kingdom’s capital, Riyadh.

‘So within 20 years, we will be an economy or state that doesn’t depend mainly on oil.’

It
is nearly 80 years since the first oil was discovered in Saudi Arabia
but, with crude prices plummeting worldwide, the nation plans to shake
its dependence on the market.

One
of the first steps will be for Saudi Arabia to sell shares in Aramco’s
parent company, which will transform the oil giant into an 'industrial
conglomerate'.

According to the prince, the son of King Salman, the sale of Aramco could come as early as 2017.

'What
is left now is to diversify investments, so within 20 years, we will be
an economy or state that doesn’t depend mainly on oil.'

- Deputy Crown Prince Mohammed bin Salman

But
if all goes to plan, the fund will eventually be large enough to buy
all four of the world’s largest publicly traded companies – Apple Inc.,
Google parent company Alphabet Inc., Microsoft Corp. and Berkshire
Hathaway Inc.

Although
the proportion of foreign investments is currently at just five per
cent of the fund, PIF plans to increase it to 50 per cent by 2020.

But
Prince Mohammed said he doesn’t believe the kingdom has a ‘real
problem’ when it comes to low oil prices, despite the fact the price of a
barrel of crude oil has more than halved.

‘Undoubtedly, it will be the largest fund on Earth,’ added the prince. ‘This will happen as soon as Aramco goes public.’

The
prince went on to confirm that Saudi Arabia will only freeze its oil
output if other key producers, including Iran, take a similar measure.

‘If all countries agree to freeze production, we’re ready,’ he said.

Photo: Reuters

It is nearly 80 years since the first
oil was discovered in Saudi Arabia but, with crude prices plummeting
worldwide, the nation plans to shake its dependence on the market

‘If there is anyone that decides to raise their production, then we will not reject any opportunity that knocks on our door.’

His
remarks come ahead of a meeting of major oil producers led by Russia
and Saudi Arabia set to take place in Doha on April 17, to discuss
measures to stabilise prices, including a proposal not to pump out oil
above a certain level.

Undoubtedly, it will be the largest fund on Earth.

Deputy Crown Prince Mohammed bin Salman

Iran
indicated it was ‘ready to participate’ in the meeting and demanded an
exemption from the freeze in order to boost its exports, according to
Russian Energy Minister Alexander Novak.

Oil
prices are being hit in part owing to the return of Iranian crude to
markets after crippling economic sanctions on Tehran were lifted
following last year’s nuclear deal between Iran and world powers.

The
upcoming meeting in Doha is a follow-up to talks in February between
Qatar, Russia, Saudi Arabia and Venezuela, in which they first mooted
the output freeze.